The fast spread of COVID-19 worldwide and the actions taken by regulatory bodies have created challenges for the shipping industry in particular given its international character. Much information is available, but it is fragmented. This article set outs several issues of importance and gives basic information to help parties handle the situation at hand in the best possible manner.
Project financing has historically been a popular investment scheme and source of capital in Norway for shipping projects. However, the Norwegian regulatory authorities recently published guidelines regarding the application of the alternative investment fund (AIF) regime to project finance entities. Issuers, advisers, arrangers and investors in shipping projects must be aware of the pitfalls of being captured by the wide definition of an 'AIF' and the steps that they can take in order to adapt to the regulations.
In the lead up to delivery under shipbuilding and offshore fabrication contracts where delivery is delayed, buyers may occasionally face claims that they have disrupted the contractor's progress in such a way that the contractor is entitled to an extension of the delivery date and/or damages for the additional costs incurred. A recent ruling from the Supreme Court involving land-based construction clarifies the requirements as to causation for such a claim to succeed.
Parliament recently decided that Norway will ratify the Nairobi Wreck Removal Convention and that the convention will be given effect not only in Norway's exclusive economic zone, but also in its territorial waters. Parliament also adopted legislation to implement the convention into Norwegian law once ratified. The legislation will introduce a dual system where the national rules on wreck removal will continue to be in effect and the convention rules will be introduced as a parallel set of rules.
Unmanned ships are on the horizon and the Norwegian maritime sector is uniquely positioned to take a leading role internationally in the development and commercialisation of this technology. Autonomous shipping may be Norway's maritime equivalent of Project Apollo, but is the legal framework keeping pace?
The 2019 version of the Nordic Marine Insurance Plan 2013 recently entered into force. Among other things, the revisions introduce an arbitration clause as an option for insurances with Nordic claims leaders. Making arbitration the default position when there is a non-Nordic claims leader aims to align the plan with market practice. However, the change has also been brought about by the looming consequences of Brexit.
In a recent judgment in the Full City limitation fund proceedings, the Supreme Court clarified how a global limitation fund established pursuant to the Norwegian Maritime Code should be distributed. The court held that the interest component in the limitation fund should be distributed only on the claims for interest and not on the other claims filed in the fund because vessel owners' limitation of liability should remain the same regardless of whether a limitation fund is established.
In a landmark decision the Supreme Court has set aside a Court of Appeal decision which concluded that the Norwegian courts have jurisdiction under the Lugano Convention in a direct action concerning a ship collision in the Singapore Strait. The decision provides welcome clarification to liability insurers across Europe, as it sets out that the Lugano Convention is a self-contained and exclusive code governing matters relating to insurance.
In 2014 the European Free Trade Association (EFTA) Surveillance Authority commenced an audit of the Norwegian International Ship Register. Subsequently, the EFTA Surveillance Authority opened a case against Norway for a possible breach of the European Economic Area Agreement. The case concerned a geographical trade limitation applicable to ships flying the flag of the Norwegian International Ship Register.
A recent Agder Court of Appeal decision regarding remuneration for towage of the vessel Kvitnos underscores that where commercial terms have been discussed, a party wishing to claim a salvage award should expressly reserve its rights to do so. The case also illustrates that oral agreements may give rise to disputes when parties have divergent impressions of what has been agreed, especially in distressed situations where time is of the essence and information is scarce.
In some transactions, a non-Norwegian company may wish to register its ship with the Norwegian International Ship Register. This can be done only if the ship is managed by a shipping company that has its head office in Norway. This requirement has a bearing on the contractual structures and financing schemes that can be put in place and also raises issues concerning enforcement.
The Supreme Court recently clarified a number of unsettled issues that will have an impact on other wreck removal cases, including whether vessel owners can use their right to limit liability as a defence against a wreck removal order. Among other things, the decision has clarified the highly disputed interpretation of the relationship between owners' duty to take action and their right to limit liability.
A year and a half after the entry into force of the Nairobi International Convention on the Removal of Wrecks, the Ministry of Transport has completed a consultation process on a proposal to ratify the convention and implement it into Norwegian law. The ministry has suggested that the convention be implemented on a dual basis, alongside existing legislation.
Since arbitration requires agreement between the parties, a third party is not normally bound by, or entitled to invoke, an arbitration clause. However, there are exceptions to the rule. It is recommended, when drafting arbitration clauses, to take into account not only the position of the contractual parties, but also the position of possible third parties, since this may reduce or avoid the risk of difficult procedural questions that may arise if claims are later made by or against a third party.
Norway and Brazil signed a memorandum of understanding in November 2015 to enhance cooperation within the area of maritime transport. The memorandum is in line with the Norwegian government's long-term cooperation strategy for Brazil and is intended to increase both public and private sector cooperation and awareness to create mutual economic opportunities and promote investment.
The civil law concept of force majeure is well established in Norwegian law, covering scenarios such as natural disasters, severe weather and war. It is recognised as both a statutory and contract term. However, although there is extensive practice and doctrine on force majeure clauses, a lack of clarity remains regarding what constitutes force majeure and what the effects of such situations are.
As the Norwegian aquaculture industry continues to grow, so does demand for well boats. These sophisticated vessels not only transport fish, but also undertake complex tasks such as delousing and sorting fish. Damage to or loss of the fish handled by these vessels can result in substantial losses. Therefore, owners and charterers of well boats should regulate the risks associated with such services in their charterparties.
Historically, cruise ships calling at Norwegian ports have not been allowed to be registered in the Norwegian International Ship Register. However, a recent change to the Norwegian International Ship Register Regulations has relaxed the trading limits and now allows such ships to be registered in the register if certain requirements are fulfilled.
The general rule regarding set-off under Norwegian law is that a party which disputes a declaration of set-off must initiate legal proceedings in order to establish that there is no basis for set-off and that its claim shall be paid in full. But what happens in a case where the two claims are subject to different limitation periods – such as cargo claims and freight claims?
Amendments to the 1996 Protocol to the Convention on Limitation of Liability for Maritime Claims recently entered into force, significantly increasing the limits of shipowners' liability. The Norwegian Parliament has passed legislation to implement the new limits, so the increased limits now apply in all cases where the limitation of liability is invoked for property claims or claims for loss of life or personal injury before a Norwegian court.